Tuesday, April 27, 2010

House Committee Schedules Hearing on Key Issues Affecting Retirement Systems -by- Robyn Ekings

The House Retirement Committee has scheduled a Wednesday, May 5th hearing on a bill to place new employees of four state retirement systems hired on or after January 1, 2011, in a defined contribution plan, instead of the current defined benefit plan. HB 930 by House Speaker Jim Tucker would apply to the Louisiana State Employees’ Retirement System (LASERS), the Teachers’ Retirement System of Louisiana (TRSL), the Louisiana School Employees’ Retirement System (LSERS) and the Louisiana State Police Pension and Retirement System (LSPRS). This would be the first step in the measure’s legislative process, which would also require the approval of a separate constitutional amendment. The LASERS Board of Trustees strongly opposes the change, noting that it would remove constitutional protections for member benefits while providing no short-term savings for the state, no debt reduction for the System, and no definitive long-term savings for the state.

The panel is also set to hear HB 1229 by Speaker Tucker. The bill would consolidate the investment duties of the four state retirement systems by creating the State Retirement Investment Commission. The commission would be given the sole authority for investment management and disposition of assets of the systems. The LASERS Board of Trustees opposes the measure.

The May 5th agenda also includes HB 1337 by Lafayette Representative Joel Robideaux. It calls for a benefit structure and employee contribution rate change for members of the four state retirement systems hired on or after January 1, 2011. Among other things, the measure requires the closure of all sub plans and enhanced benefits within LASERS for all those hired on or after January 1, 2011, and consolidates all hazardous duty personnel in LASERS into a newly created Hazardous Duty Plan within LASERS. The proposed law also requires members of state retirement systems hired after January 1, 2011,to pay employee contributions equal to one half of the system’s normal cost. The LASERS Board of Trustees supports this bill as it applies to LASERS since it would reduce costs to the system.

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